Bitcoin: money laundering instrument in drug trafficking?

In international drug trafficking, the popularity of bitcoin will increase as a means of money laundering. This is the result of a report from the US Drug Enforcement Agency (DEA).

For many, the American law enforcement agency DEA is known mainly for its – in some cases extremely brutal – fight against the Latin American drug cartels in the 1980s and 1990s. The DEA is also active in the international fight against drug trafficking and smuggling, but the way the agency operates has changed somewhat. Thus, the focus has now been placed on the work of the global financial flows, which are used to finance drug trafficking.

The fact that bitcoin also plays a role in this is evident from the current Drug Report of the DEA. Among other things, it sets out how the international trade in illicit drugs is organized and the measures the US government is planning to stop financing. In this context, there is also a section on the subject of cryptosis and the misuse of it as an instrument for money laundering. For example, Bitcoin’s acceptance has recently increased, especially in the trade of illegal drugs.

A popular basis for this type of money laundering is according to the report the People’s Republic of China. For example, companies operating in China, which rely on Bitcoin as a means, should be the means. According to this, drug traffickers are particularly benefiting from the anonymity of cryptography, as this makes it possible to circumvent the control of capital flows by the Chinese government and to pursue their own business in peace.

In addition, the report highlights the relevance of over-the-counter Bitcoin brokers for international drug trafficking. As they are able to send Bitcoin across the boundaries of the value of millions, they play an important role for capital flows and offer themselves for criminal networks for money laundering.

Virtual currency is not legal tender, is not backed by the government, and accounts and value balances are not subject to consumer protections. The information does not constitute investment advice or an offer to invest.